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Is the proposed student loan scheme a sensible or terrible idea?

By Anne Sexton - Last update


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The Union of Students in Ireland (USI) says that a student loan scheme is not an effective way to fund college education. They have a point. Large numbers of students in the UK and US graduate severely in debt. In addition, student leaders claim that setting up a loan scheme would be expensive. The also say that it would result in a new emigration ‘brain drain’.

The Cassells Report

President of USI Annie Hoey criticised the proposal.

“Less than a month after the Larkin Report which pointed out the long-term economic and short-term financial shortfalls of an income-contingent loan scheme, the Government is trying again to obscure the facts and create the impression that the only viable funding mechanism for Higher Education is a loan scheme,” said Ms Hoey.

“The Cassells Report showed that properly tax-funded higher education is a viable option, whereas a €10bn loan scheme favoured by Government right now is an attempt to borrow now and move the mess of repayment down the track,” she added.

The Cassells Report by the Expert Group on Future Funding for Higher Education recommended three funding options. One of these was replacing upfront fees with loans provided by the State.

Loans would be contingent on earnings. In addition, loans would have deferred repayments until a graduate was earning over a certain amount. The maximum monthly payment would €160 until the age of 33.

Loan scheme equivalent to reintroducing fees

USI claims the scheme is “out of touch with the reality of graduate salaries.”

“With the average salary in Ireland around €46,000, graduate salaries in Ireland are around €28,000, and significantly lower in Dublin,” Ms Hoey said.

Solidarity TD Mick Barry the loan scheme was simply a way of reintroducing full fees.

“The introduction of any student loans scheme amounts to the re-introduction of fees. It would be a regressive step which would effectively remove education as a right open to all.

“Over the last number of years we have seen huge increases in fees through almost yearly increases in the registration charge. The loan scheme would be full fees being re-introduced through the back-door.”


Anne Sexton

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